FACTORS IN INDUSTRIAL COMPETITION. 439
to retain it if the price quoted follows every boom in the home market; and it is certainly good policy to keep the trade of this railway for future business, in spite of the hue and cry about lower prices to foreign buyers.
(14) This argument is not new, but has been an accepted commercial and industrial maxim in every country, under both protection and free trade, and all the "prices abroad," so freely quoted, are based on this rule as existing in foreign lands. It is even true that bounties are actually paid in some instances to encourage export trade.
(15) The payment 01 a bounty for export trade is directly in ' line with the maintenance of a protective duty after the incubative period has passed. Practically it must be looked upon as out of the question owing to the impossibility of arriving at a complete knowledge of just what would be equitable, but although such a system would breed many wrongs, it is theoretically justifiable to a certain limited extent.
A steel works, in common with every manufacturing plant, is a benefit to the general public in many ways. It contributes to the payment of taxes and thus saves an equivalent amount of individual expenditure. It is the foundation of large, communities which influence and increase the general prosperity of the country by giving a market for all kinds of commodities. It supplies freight to the railroads in enormous quantities, and brings an enormous income to the railroads, the gross receipts from a steel works being four or possibly six times as much as though a similar amount of material were imported from abroad, and there were no raw materials or incidental supplies to assemble. The cost of moving other freight is reduced by this increased business, and the establishment of other industries thereby made possible, which, in turn, react by further lowering the cost of transportation by their contribution to tonnage moved.
A nation would lose no money if a bounty were paid to support manufactures, provided such support were necessary,, and provided that the bounty did not exceed the sum directly and indirectly paid or saved by the manufacturer to the state and to the public. If German steel is laid down in England at one shilling per ton cheaper than English steel works can make it, and if that shilling represents the dividing line of business, then it would be money in